Financial Wealth. (fĭ-năn shэl, wĕlth) n. The unearned income to finance your life mission without having to work.

Transcription

1 Financial Wealth (fĭ-năn shэl, wĕlth) n. The unearned income to finance your life mission without having to work.

2 The Millionaire Real Estate Investor is dedicated to the men and women who have a passion for their work and yet dream of someday achieving financial independence, of someday being able to finance their mission in life without having to work. This book is dedicated to all those who want the biggest life possible, who are actively seeking ways to finance that vision, who want to go as far as possible with as few roadblocks as possible, and who want to say that at the end of the day, I m glad I did instead of I wish I had. 4 THE POWER OF PROVEN MODELS OVER TRIAL AND ERROR Page 0 Your Highest Level of Achievement Where You Begin with Action Based on Proven s Your Natural Ceiling of Achievement Where You Begin with Action Based on Personal Experience Trial & Error 5 THE FOUNDATIONAL MODEL OF THE MILLIONAIRE REAL ESTATE INVESTOR Page Identify Potential Deals CRITERIA Receive Own Buy Think Determine the Real Deals TERMS NETWORK Supports Your Deals 6

3 Overcome Your MythUnderstandings 7 EIGHT MYTHUNDERSTANDINGS BETWEEN YOU AND FINANCIAL WEALTH Three Personal Myths Myth: I Don t Need to Be an Investor My Job Will Take Care of My Financial Wealth Truth: Yes, You Do Need to Be an Investor Your Job is Not Your Financial Wealth Myth: Truth: I Don t Need or Want to Be Financially Wealthy I m Happy with What I Have You Need to Open Your Eyes You Do Need and Want to Be Financially Wealthy Myth: It Doesn t Matter If I Want or Need It I Just Can t Do It Truth: You Can t Predict What You Can or Can t Do Until You Try 8 EIGHT MYTHUNDERSTANDINGS BETWEEN YOU AND FINANCIAL WEALTH Five Investing Myths Myth: Investing is Complicated Truth: Investing is Only as Complicated as You Make It 4 Myth: The Best Investments Require Knowledge Most People Don t Have Truth: Your Best Investments Will Always Be in Areas You Can or Already Understand Myth: Investing is Risky I ll Lose My Money Truth: Investing, by Definition, is Not Risky Myth: Successful Investors are Able to Time the Market Truth: In Successful Investing the Timing Finds You 5 Myth: All the Good Investments are Taken Truth: Every Market has Its Share of Good Investments 9

4 Think A Million 0 THE SEVEN WAYS MILLIONAIRE REAL ESTATE INVESTORS THINK Page 78. Think Powered by a Big Why. Think Big Goals, Big s, and Big Habits. Think Money Matters 4. Think Net Worth 5. Think Real Estate 6. Think Value, Opportunity and Deals 7. Think Action THE BIG WHY Page 8 Personal Growth I want to be the best I can be My Big Why Why Why Why Why Why Why

5 BIG GOALS, BIG MODELS & BIG HABITS Page 86. Big Goals The specific, measurable targets that fulfill your Big Why.. Big s The proven systems and strategies for reaching your Big Goals.. Big Habits The consistent actions and right choices that come from following Big s. THE MONEY MATRIX Page 89 MONEY WORKS for you! Consumption Cash Cash Flow Financial Wealth is build on CAPITAL and CASH FLOW Capital Consumption Shadow Wealth is built on CONSUMPTION and CASH Cash Cash Flow Capital YOU WORK for money! 4 REAL ESTATE A MOST ABLE INVESTMENT Page 99 A. Accessible Anyone can buy it B. Appreciable Increases in value over time C. Leverageable Buy on margin & borrow against equity D. Rentable Cash Flow! Cash Flow! Cash Flow! E. Improvable Sweat equity F. Deductible/Depreciable/Deferrable Great tax benefits G. Stable Slow to rise & slow to fall H. Liveable Shelter in more ways than one. 5

6 THINK VALUE, OPPORTUNITY & DEALS Page Know Value Find Opportunity Make Deals 6 Think Action Page 7 S Collector Low Risk Low Return Minimum Risk I Investor Maximum Return S Speculator High Risk High Return Action Inaction Action Inaction No Risk O Observer No Return 7 Buy A Million 8

7 THE FIVE MODELS KEY AREAS Page 6 Net Worth Financial Network Learn the Path of Money Budget for Investments Make Investments & Track Net Worth 4 Lead- Generation Establish your Criteria Prospect & Market for Real Estate Investment Opportunities Understand the Triple Benefits of Real Estate: Cash Flow Appreciation Debt Pay Down 5 Acquisition Master Terms for Making Offers and Closing Deals Buy & Sell Buy & Hold Network for Knowledge, Leverage and Leads Build your Investment Dream Team 9 Net Worth Learn the Path of Money Budget for Investments Make Investments & Track Net Worth 0 HOW A CONSUMER SEES THEIR BUDGET Page 4 CONSUMER S BUDGET CONSUMER S PERCEIVED BUDGET Confuses Discretionary Spending with Required Spending Which is why they just can t afford to invest. Investment Spending Income Taxes Required Spending Discretionary Spending

8 HOW AN MILLIONAIRE INVESTOR SEES THEIR BUDGET Page 5 MILLIONAIRE INVESTOR S BUDGET MILLIONAIRE INVESTOR S PERCEIVED BUDGET Considers Investment Spending to be Required Spending. Which is why they always have money to invest. Investment Spending Income Taxes Required Spending Discretionary Spending The Financial Understand the Triple Benefits of Real Estate Cash Flow Appreciation Debt Pay Down THE FINANCIAL MODEL PART ONE: EQUITY BUILD UP Page 46 + = Price Appreciation Debt Pay Down Equity Build Up MARKET VALUE Equity Investment Debt MARKET VALUE Equity Investment Debt Buy It Right MARKET VALUE Equity Investment Debt Pay It Down MARKET VALUE Equity Investment Pay It Off 4

9 THE FINANCIAL MODEL PART TWO: CASH FLOW GROWTH Page 49 + = Rent Appreciation Debt Pay Off Cash Flow Growth RENT Vacancy & Expenses Debt Service Cash Flow RENT Vacancy & Expenses Debt Service Cash Flow RENT Vacancy & Expenses Debt Service Cash Flow RENT Vacancy & Expenses Cash Flow Buy It Right Pay It Down Pay It Off 5 The Network Network for Knowledge, Leverage and Leads Build Your Investment Dream Team 6 THE MILLIONAIRE REAL ESTATE INVESTOR S WORK NETWORK Page 59 Title Companies Landscapers Lenders Developers Financial Planners Insurance Agents Concrete Companies Consultants Attorneys Roofers Plumbers Property Managers Masons Courthouse Clerks Appraisers Real Estate Agents Partners MILLIONAIRE REAL ESTATE INVESTOR INNER CIRCLE SUPPORT CIRCLE SERVICE CIRCLE Inspectors Investors Mentors Leasing Agents Accountants Contractors Painter Maintenance Technician Builders Electrician Appliance Rentals Cleaning Services Lawn Service Flooring & Carpet Carpenter 7

10 4 Lead Generation Establish Your Criteria Prospect & Market for Real Estate Investment Opportunities 8 THE LEAD GENERATION MODEL FOR INVESTMENT PROPERTIES WHAT Have Clear Criteria for the Property you want to Invest in WHO Identify the People who can connect you to Properties that meet your Criteria HOW Systematically Lead Generate for Properties and People 4 WHICH Separate Suspects from Prospects 9 WHAT AM I LOOKING FOR? Have Clear Criteria for the Property you want to Invest in. Location. Type. Economic 4. Condition 5. Construction 6. Features 7. Amenities Two Kinds of Criteria ) What You ll Consider ) What You ll Buy 0

11 MILLIONAIRE REAL ESTATE INVESTOR S CRITERIA WORKSHEET Page 84 ) LOCATION Country State/Province Taxes Rentals Laws Weather County/Parrish City/Town Taxes Services Neighborhood School District Crime Transportation Shopping/Recreati on Street Traffic Size Lot Zoning Adjoining Lots Lot Size Trees Privacy Landscaping Orientation/View ) TYPE Single Family Home Condo Town Home Mobile Home Zero Lot/Garden Small Multi Family Duplex Fourplex Large Multifamily/Commercial Land/Lot New/Preconstruction Resale Urban Suburban Exurban Rural Resort/Vacation Farm/Ranch ECONOMIC Price Range From $ To $ Discount % Cash Flow $ / Mo Appreciation % /Yr How Millionaire Real Estate Investors Find Opportunity Page 98 Networking % Real Estate Agents/MLS 8% Driving/Walking Newspaper & Ads Foreclosure Listings 7% 0% 9% For Sale By Owners Internet/Database Research Targeted Marketing Other 4% % % 5% WHICH PROPERTIES ARE THE REAL OPPORTUNITIES? 4 Separate Suspects from Prospects. Qualify all Suspects. Focus only on Prospects

12 THE LAW OF NUMBERS Page 6 0 Consider 0 Look At Offers Buy 4 5 The Acquisition Master Terms for Making Offers & Closing Deals Cash Building Cash & Equity Build up 5 THE ACQUISITION MODEL OF THE MILLIONAIRE REAL ESTATE INVESTOR Page Profit Margin 4 CASH Buy, Improve & Sell Buy & Sell Control & Assign Find & Refer Volume Profit Margin CASH FLOW & EQUITY Buy, Improve & Hold Buy & Hold Lease Option Volume Your Cash-Building Platform Your Wealth-Building Platform 6

13 TERMS WORKSHEET: BUY & SELL Terms Worksheet After Repair Value (ARV) $ Fast Sell Factor $ % Operating Terms Purchase Terms Fast After Repair Value (FARV) = $ Discount/Profit $ % Cost of Purchase (COP) $ Cost of Repair (COR) $ Carrying Costs (CC) $ 4 Cost of Sale (COS) $ Purchase Price = $ Amount Financed $ Total Investment = $ Cost of Purchase Sub-Worksheet Finder's Fee $ Inspection + $ Closing Costs + $ Total Cost of Purchase = $ Cost of Repair Sub-Worksheet Cosmetic Minor + $ Cosmetic Major + $ Structural + $ Fixtures/Appliances + $ Landscaping + $ Contingency Factor + $ % Total Cost of Repair = $ Carrying Costs Sub-Worksheet Taxes + $ Fees/Insurance + $ Utilities/Services + $ Debt Service + $ Property Upkeep + $ Total Carrying Cost = $ 4 Cost of Sale Sub-Worksheet Agent Commissions + $ Home Warranty + $ Title Insurance & Fees + $ Buyer Closing Costs + $ Total Cost of Sales = $ 7 Operating Terms Purchase Terms Terms Worksheet: Buy & Hold Terms Worksheet $ 5, Market Value (MV) $ 5, Discount/Profit 0% = $ 00, Purchase Price Amount Financed $ 80, Down Payment = $ 0, % Purchase (COP) + $ Cost of Cost of Repair (COR) + $ 7, Investment = $ 8,00.00 Total Net Operating $ 56. Income (NOI) 4 Principle & Interest $ Flow Monthly/ Annual = $ 7.79 Cash = $ 9.5 Cost of Purchase Sub-Worksheet $ 0.00 Finder's Fee Inspection $ Closing Costs + $ Total Cost of Purchase = $ Cost of Repair Sub-Worksheet + $,00.00 Cosmetic Minor Cosmetic Major + $ 0.00 Structural + $, Fixtures/Appliances + $,50.00 Landscaping + $ , Contingency Factor + $ % Repair = $ 7, Total Cost of Net Operating Income Sub-Worksheet Gross Rental Income $, % of MV Vacancy $ Net Rental Income = $ Expenses 8% Property $ 0.00 Management Leasing Costs (Annual/) $ 6.67 Maintenance (Annual Reserve/) $ 0.00 Utilities $ 0.00 Property Taxes $ % of MV Insurance $ % of MV Other $ Operating Income = $ 56. Net 4 Principle & Interest Sub-Worksheet 0-Year Mortgage 0-Year Mortgage Rate 6.97% 0-Year Principle & Interest $ Year Mortgage Rate 5-Year Mortgage Rate 7.4% 5-Year Principle & Interest $ PUT IT ALL TOGETHER Get Motivated Big Why Big Goals Become An Investor Acquire Knowledge & Focus Understand & Path Money Build Network Define Criteria Learn Real Estate Market Generate Leads Prospect Build & Work Database Market Leads Convert Suspects To Prospects Inspect Properties Buy Real Estate Engage Network Make Offers & Negotiate Terms Acquire Deals Interview Sellers Gain Insight Evaluate Results 9

14 How can we help? Answer your Questions Building your Work Network and Leads Network Millionaire Mondays THANK YOU FOR COMING! 40